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Metro Pacific to raise up to $300M in fresh funds

Wednesday, June 1, 2009 | MANILA, PHILIPPINES [ BusinessWorld Online ]


LISTED HOLDING company Metro Pacific Investments Corp. wants to sell more shares to raise funds for future infrastructure investments and put more shares in the hands of the public.

"Metro Pacific is considering, subject to favorable market conditions, a fund-raising exercise to broaden its current investor base. It is envisaged that Metro Pacific’s fund-raising exercise would be [done through] a public offering or placement of Metro Pacific’s shares to independent investors," it told the exchange yesterday.

Metro Pacific Chief Finance Officer Andrew G. Shepherd said selling more shares to the public would improve the company’s float, which is only at 8%.

"The size of our float is very small for a public company like us. We need to increase the size of the float [to make the company more liquid] and to raise the cash to fund our future investments in infrastructure," he said.

Metro Pacific has 9.42 billion outstanding shares. The company will conduct a road show for 3.5 billion shares it plans to sell to the public, said Melody del Rosario, Metro Pacific assistant vice-president for media and corporate communications.

"We are going to Hong Kong, Singapore, United Kingdom and the United States," Ms. del Rosario said. Around $300 million could be raised from foreign investors, she said.

Metro Pacific Chairman Manuel V. Pangilinan yesterday told reporters that the "discussion is between $200 million to $300 million but nothing is definite still."

"The pre-marketing phase will start very soon so we want to alert the market that there is a significant fund-raising coming with respect to Metro Pacific and then based on the market’s soundings [we will] then determine the price and the issue size," he said.

Last month, Mr. Pangilinan said Hong Kong-based parent First Pacific Co. Ltd. is not averse to the possibility of Metro Pacific becoming "a truly public company."

First Pacific holds a 98% stake in Metro Pacific. Metro Pacific is planning to increase its public float to 25% from 8%., Mr. Pangilinan earlier said.

Mr. Pangilinan, who also heads Philippine Long Distance Telephone (PLDT) Co., had bared plans to spend P38.1 billion for various infrastructure projects. These include the second phase of North Luzon Expressway (NLEx)-Segment 8.1 connecting the tollway to Mindanao Avenue; Segments 9 and 10 which will connect the NLEx to MacArthur Highway in Valenzuela and the Port Area in Manila; and the tollway linking the NLEx to the South Luzon Expressway, running from C3 Road in Caloocan to Gil Puyat Avenue in Makati.

Metro Pacific is also looking at a possible investment in Indonesian-led Citra Metro Manila Tollways Corp. ,which operates the Metro Manila Skyway, and the group behind the Manila-Cavite Toll Expressway extension to Noveleta in Cavite.

Mr. Pangilinan also told reporters yesterday that Metro Pacific might join the bidding for the privatization of the operations of the 65.8-kilometer Subic-Clark-Tarlac Expressway.

"If they wish to privatize it, we will make an offer," Mr. Pangilinan said. Metro Pacific holds an interim arrangement with the government to operate and maintain the tollway for a year until June 2010.

In an interview, BCDA spokesman Robert Gervacio said privatization is not being ruled out. "We are already preparing the terms of reference for the bidding and hopefully we will finish that within the month and award [it to] the winner by yearend," Mr. Gervacio said.

Shares in Metro Pacific did not move at P5.10 apiece yesterday.

Mediaquest Holdings, Inc., a unit of the PLDT Beneficial Trust Fund, has a minor stake in BusinessWorld. — Kristine Jane R. Liu

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